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Finding the right mix of risk and protection for your retirement portfolio can be a challenge in today's economically tough times. Every investor is aware of the potential for future inflation and dollar devaluation that can quickly gobble up investment returns and dividends. The question remains: how do you protect against these in a long term retirement portfolio? One of the best ways to add inflation protection to your portfolio is to add exposure to commodities that might rise. Agriculture related commodities, like wheat, rice, and corn, are good examples of commodities that will rise in price along with inflation, helping your portfolio keep up. Gold and oil are other examples of specific commodities that will give you an inflation hedge and protection against a decrease in value of the dollar. Copper is a unique commodity when it comes to its price fluctuations. Copper is a semi-precious metal, and has often shown that rather than increase in value during tough times, it increases in value during economic booms. Why is that? The answer lies in what copper is used for. Construction. Copper pipes for plumbing and copper wire for electrical wiring are essential in new home and infrastructure construction. Therefore, as building increases (in an economic boom), copper prices go up. A good retirement portfolio should have a good mix of copper and dollar and inflation protecting gold and silver. A great way to invest in these commodities is through exchange traded funds, or ETFs. ETFs are similar to mutual funds, but have many advantages over them. They can be traded intraday, they have low fees, and can be as specific or as broad as you want. There are good copper ETF options available on the market, as well as blended precious metals ETF options. Be sure to do your research before allocating money in any investment.
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